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Old 24th September 2010, 09:18   #331
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Interesting, why do you call it wasting?
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+1 to that. It cannot be termed as wasting but as a calculated risk cost.
Well wasting is a wrong term used; rather I would say, the benefits are known only when I pass away; so, if I'm alive, I don't get to see any benefits other than a little bit more - peace of mind

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Also what benefit are you getting in making a lumpsum payment?
Well, I I saw it this way...
Half yearly 4450 X 2 X 25 = 222500
Annually 8725 X 25 = 218125
Single premium - 110,575

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Originally Posted by Technocrat View Post
Have you factored in the loss of interest on this1.1 lakh (or 96-97k after first premium)?
Yes; nice point, got me thinking...
First year saving 110575-8725 = 101850, invest the money & even if one gets mere 8% interest, that is sufficient to pay the next year's premium. That's a good option too, but still, I somehow feel uncomfortable. Probably its all in the mind I guess.

I was just considering Aegon Religare that was discussed in the Life Insurance thread as the premium are damn low, say about 97K or so for 25L coverage. But looks like there're quite uncertainities also being discussed over there. So when I'm clear on term insurance confusion on insurance company & mode of payment are smiling at me.

Last edited by aargee : 24th September 2010 at 09:22.
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Old 24th September 2010, 09:46   #332
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Guys,
I want to invest 20K/month for 3-4 years max for building a home for myself on a plot i purchased. Which one do you guys think as best method to invest in with max returns after 3 years time frame.

Thanks in advance.

Ramki
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Old 24th September 2010, 10:34   #333
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Originally Posted by ramki067 View Post
Guys,
I want to invest 20K/month for 3-4 years max for building a home for myself on a plot i purchased. Which one do you guys think as best method to invest in with max returns after 3 years time frame.

Thanks in advance.

Ramki
It depends upon what amount are you looking for and what type of risks are you willing to take.

If you are an aggressive investor the best option would be to invest 60% in stocks, 40% diversified equity funds growth option

If you are medium risk investor the options would be 40% stocks, 30% MF's and 30% Bank deposits.

If you are totally risk averse then the bank FD's and debt MF's would be your options.

So take you pick and start investing. All the Best.
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Old 24th September 2010, 10:43   #334
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Originally Posted by ramki067 View Post
I want to invest 20K/month for 3-4 years max for building a home for myself on a plot i purchased. Which one do you guys think as best method to invest in with max returns after 3 years time frame.
3-4 years only? Can you extend to 5th year? Then this will be what you'll have in hands...
Principle
Rs 20000 X 60 months = Rs 1200000
Interest = 257800
Total = Rs 1457800

Stocks can guarantee any returns, but there's also a possibility of returns of 10 times the money you invested.

Another option would be is to split the money into 3; invest some in PO (returns guaranteed), SIP/MF, Bank.
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Old 24th September 2010, 11:08   #335
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Investing in stocks directly is no guarantee of returns hence avoiding completely. Yes i'm looking for 3 years investment basically for obtaining close to 15L but if not succeed then with go for 4th year.

How about MFs, Is it that if i start a SIP, can i withdraw when ever i need cash?
What forms of PO should i look for returns guaranteed? I think Bank FDs give less returns compared to PO investments like RD right?

Thanks,
Ramki

Last edited by ramki067 : 24th September 2010 at 11:15.
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Old 24th September 2010, 11:24   #336
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Investing in stocks directly is no guarantee of returns hence avoiding completely. Yes i'm looking for 3 years investment basically for obtaining close to 15L but if not succeed then with go for 4th year.
4 years & 15 Lakhs with monthly 20K??? No looking back, only stocks/SIP/MF/real estate can do that figure.
Let me show what's you're expecting...

Rs 15,000,000/48 months = Rs 31250 per month
However you're investing only 20000 which means the balance Rs 11250 should be available as interest. So you need to look for an investment that provides you Rs 11250 as interest for Rs 20,000 that you're investing every month.

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How about MFs, Is it that if i start a SIP, can i withdraw when ever i need cash?
IMO, there're some entry & exit loads. Not sure, but I heard those have been withdrawn now. You may want to check the current norms.

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What forms of PO should i look for returns guaranteed?
I showed you a calculation above on PORD. Is there anything specific you're looking at?

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Originally Posted by ramki067 View Post
I think Bank FDs give less returns compared to PO investments like RD right?
Right
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Old 24th September 2010, 11:41   #337
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Originally Posted by ramki067 View Post
Investing in stocks directly is no guarantee of returns hence avoiding completely. Yes i'm looking for 3 years investment basically for obtaining close to 15L but if not succeed then with go for 4th year.

How about MFs, Is it that if i start a SIP, can i withdraw when ever i need cash?
What forms of PO should i look for returns guaranteed? I think Bank FDs give less returns compared to PO investments like RD right?

Thanks,
Ramki
What you are saying is that for an invetsment of 3.6L you want a return of 15L in a time frame of 3 yrs i.e an return of 208%. This kind of return can either be expected from the Stock market or equity diversified MF's.

If you are averse to stocks, then how can you trust the MF's since most of the MF's invest in stocks again.

Believe me you cannot absolutely get 200% returns on bank FD's and PO investments.
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Old 24th September 2010, 11:45   #338
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@ghodlur: A lot of us don't have the time and soem like me the smarts to understand the stock market.

So we outsource it to MF's. In my case that would be the ELSS MF Option.
A good saving in tax and most of them do end up giving a decent return as the lock in period of 3 years helps.
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Old 24th September 2010, 11:57   #339
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@ghodlur: A lot of us don't have the time and soem like me the smarts to understand the stock market.

So we outsource it to MF's. In my case that would be the ELSS MF Option.
A good saving in tax and most of them do end up giving a decent return as the lock in period of 3 years helps.
No smartness needed in invetsing in blue chip stocks or a large cap stock. There are the first to nose dive and these are the first to soar high.

Take an eg of Tata Motors. the stock price in March 2009 was 157 and today it is 1057 and increase of 900 rupees which is 575% returns. This kind of returns can be expected from the stock market only.

I am not advising into putting entire money into stock market. Invest like an SIP for a specific stock say 1000/- every month, same philosophy as MF and you are bound to get atleast 30-40% returns if all goes well.
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Old 24th September 2010, 11:58   #340
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I would not recommend you to put entire money into stocks/MF for a long term at this point of time. Please note that our markets are at its peak now and the economy is not. I would recommend you to put half of the money in recurring deposits with bank and take MF SIPs for the rest.
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Old 24th September 2010, 11:58   #341
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Originally Posted by ghodlur View Post
What you are saying is that for an invetsment of 3.6L you want a return of 15L in a time frame of 3 yrs i.e an return of 208%. This kind of return can either be expected from the Stock market or equity diversified MF's.
Ghodlur,

I think you intended to say 9.6L for 4 years term and not 3.6L!
How about Dept Funds? Is it better to a PORD?

Last edited by ramki067 : 24th September 2010 at 12:00.
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Old 24th September 2010, 12:04   #342
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What you are saying is that for an invetsment of 3.6L you want a return of 15L in a time frame of 3 yrs i.e an return of 208%.
3.6L??? How is it 3.6L? 20,000 X 36 months = 7.2L. Am I missing something here?

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Originally Posted by ghodlur
No smartness needed in invetsing in blue chip stocks or a large cap stock
Well, smartness is necessary!!! atleast one should know when to enter & when to quit & that will happen only when they keep watching atleast every weekend. Point - one should keep watching for ever. I'd bought TCS when the price was around 1100; it was shattering (read in Rs 600's) in 2008/09 & Wifey wanted to dispose it off. However, we still didn't. Now its in the peak. But again, I'm not sure whether to sell it off or hold it. Anyway since it was bought with excess money in hand, we're not inneed of it. But not all blue chips will yield in 3 digit returns.

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This kind of returns can be expected from the stock market only.
And real estate
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Old 24th September 2010, 12:08   #343
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How about MFs, Is it that if i start a SIP, can i withdraw when ever i need cash?
You can withdraw money from a SIP whenever you need after the first year. If you withdraw in the first year itself then there will be exit load.
The returns you get on SIP I think are taxable. Experts?
Also keep in mind that SIP pays well over a long period of time.
You usually look at a minimum of 5 years.
Reason?
SIP is basically kind of averaging instrument. You invest when market is up and when its down. And its important that SIP goes through at least one recession. And frequency of recessions is usually 4 years. My friend who started his SIP when the market was down in 2008-9 is sitting on a return of 40%!!!

Also do if you go for a SIP do not put all money in one MF. If I were you I will go for two very aggressive funds 5k each. One aggressive fund and one conservative fund again of 5k each.

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Invest like an SIP for a specific stock say 1000/- every month, same philosophy as MF and you are bound to get atleast 30-40% returns if all goes well.
SIP in MF's usually return 20% to be conservative side and if return is 25% then be happy. Do not know about the SIP in stocks of a company.
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Old 24th September 2010, 12:40   #344
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Ghodlur,

I think you intended to say 9.6L for 4 years term and not 3.6L!
How about Dept Funds? Is it better to a PORD?
Oops my mistake, it should be 7.2L @20K per months for 3 yrs. Debt funds normally invest in govt securities or bonds and are the best bet in a falling market. PORD is safe haven for invetment but the returns are fixed.

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And real estate
Real estate of course but is again linked to the stock market. However instant liquidation is a doubt.

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My friend who started his SIP when the market was down in 2008-9 is sitting on a return of 40%!!!

Do not know about the SIP in stocks of a company.
Me too, had started a SIP in a MF and the returns are somewhere around 40%.
SIP in stocks are normally provided by online brokerage firms. Mine is with Sharekhan which does provide online SIP either for a specific amount or specific stock.
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Old 24th September 2010, 15:12   #345
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I'm considering half in PORD and other half in aggressive MFs. Can i get a few good MFs to put in?

Thanks,
Ramki
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